TOKYO - The dollar rose to a three-month high against the euro in Asia Thursday after the Federal Reserve provided an upbeat outlook for the US economy and Greece was hit by another credit ratings downgrade.

The euro fell to $1.4460 in Tokyo morning trade, the lowest level since September 8, down from $1.4533 in New York late on Wednesday.

The European currency climbed to 130.62 yen from 130.49. The dollar gained to 89.95 yen from 89.77.

The greenback was firmer after the US central bank kept its overnight lending rate unchanged in a range of zero to 0.25%, but noted that economic conditions had improved recently.

Dealers said that markets see a growing chance that the Fed will hike its key interest rate by 25 basis points early next year, although some analysts were more cautious.

"We stick with our forecast that the Fed won't begin raising interest rates until the end of 2010," said NAB Capital strategist John Kyriakopoulos.

"So we don't see the dollar getting any yield support until the fourth quarter of 2010."

Investors generally favour currencies offering higher returns.

Worries about Greece's debt crisis mounted after Standard and Poor's lowered the country's long-term credit rating to BBB+ from A-, following a downgrade by another credit rating agency, Fitch, last week.

Norway surprised markets on Wednesday by raising its benchmark lending rate to 1.75%.

"Norway's economy experienced a sharp contraction but with oil prices higher now has positive momentum prompting the central bank to withdraw the emergency rate settings," said Rabobank International economist Adrian Foster.

The Czech central bank meanwhile moved in the opposite direction, slashing its rates, a move seen as underlining the persistent struggle central and emerging European economies are facing in recovering from the global downturn.

The Bank of Japan was also due to begin a two-day policy meeting Thursday, under pressure from the government to step up the fight against renewed deflation in the world's number two economy.